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SUP 16.5 Annual Close Links Reports

Application

SUP 16.5.1GRP

This section applies to every firm except those firms excluded from its operation by SUP 16.1.1 R and SUP 16.1.3 R.432

Purpose

SUP 16.5.2GRP

A firm is required to notify the FSA of changes to its close links (see SUP 11.9). Threshold condition 3 (Close links) provides that, if a firm has close links with another person, the FSA must be satisfied that:

  1. (1)

    those close links are not likely to prevent the FSA's effective supervision of the firm; and

  2. (2)

    where it appears to the FSA that the person is subject to the laws, regulations or administrative provisions of a territory which is not an EEA State, neither the foreign provisions, nor any deficiency in their enforcement, would prevent the FSA's effective supervision of the firm.

SUP 16.5.3GRP

The purposes of the rules and guidance in this section are:

  1. (1)

    to ensure that, in addition to such notifications, the FSA receives regular and comprehensive information about the identities of all persons with whom a firm has close links, which is relevant to a firm's continuing to satisfy the threshold condition 3 (Close links) (see SUP 2.3) and to the protection of consumers; and

  2. (2)

    to implement certain requirements relating to the provision of information on close links which must be imposed on firms under the 'Post-BCCI Directive'.

Report

SUP 16.5.4RRP
  1. (1)

    A firm must submit a report to the FSA annually the information in (3) or (4) (as applicable).

  2. (2)

    A firm must submit the report in (1) to the FSA within four months of the firm'saccounting reference date.

  3. (3)

    If a firm is not aware:

    1. (a)

      that it has any close links; or

    2. (b)

      of any material changes to the details in (4) (a) to (c) in respect of its close links since the submission of its previous report under (1);

    then the report in (1) must confirm this.

  4. (4)

    Unless (3) applies, the report in (1) must contain a list of all persons with whom the firm has close links as at the firm's accounting reference date of which it is aware, and for each such person state:

    1. (a)

      its name;

    2. (b)

      the nature of the close links;

    3. (c)

      if the close link is with a body corporate, its country of incorporation, address and registered number; and

    4. (d)

      if the close link is with an individual, his date and place of birth.

SUP 16.5.5G

The information required by SUP 16.5.4R(4) may be provided in the form of a group organisation chart.

SUP 16.5.6GRP

If a group includes more than one firm, a single annual close links report may be submitted and so satisfy the requirements of all firms in the group. Such a report should contain the information required from all of them, meet all relevant due dates, indicate all the firms on whose behalf it is submitted and give their FSA firm reference numbers. Nevertheless, the requirement to provide a report, and the responsibility for the report, remain with each firm in the group.1

SUP 16.5.7G

A firm may submit a single report satisfying the requirements of its annual controllers report (SUP 16.4.5 R) and its annual close links report (SUP 16.5.4 R). Such a report should contain the information required on both controllers and close links.

SUP 16.5.8RRP

If a firm is an unincorporated friendly society, then it is only required to submit a report under SUP 16.5.4 R if it is aware that it has close links.